Cheniere Energy (LNG) stock has significantly outperformed its peers in 2018. The stock has risen more than 26%, while the MLP and Energy Infrastructure ETF (MLPX) has fallen more than 5% year-to-date. Broader markets continued to trade strong and have risen ~8% so far in 2018. Cheniere Energy accounts for ~8.3% of MLPX.
The above chart shows the normalized stock price movement of Cheniere Energy and MLPX along with broader markets.
Cheniere Energy’s earnings growth largely depends on liquified natural gas exports and liquefaction capacity. The company’s annual earnings growth is supported by long-term take-or-pay sale and purchase agreements. On September 17, Cheniere Energy announced a deal to sell liquified natural gas to Vitol Group for 15 years. Cheniere Energy said that it will sell 700,000 tonnes of liquefied natural gas per year starting in 2018 with a purchase price linked to the monthly Henry Hub price in addition to a fee. To learn more about the company’s recent long-term contracts, read Cheniere Energy’s New Deal, Charts, Target Prices, and More.
To learn more about the Midstream sector, read Weekly Wrap-Up: The MLP and Midstream Sector.